John Charcol: Brown must do his duty by first-time buyers

15 March 2007

As Gordon Brown gears up to deliver what will probably be his final Budget as chancellor, property finance expert Ray Boulger of John Charcol has urged him to make stamp duty fairer for first-time buyers.

Rising house prices have brought an unprecedented number of homes bought by first-time buyers within the price bracket for stamp duty.

By "perpetuating the imposition of such an unfair property tax", Brown's Treasury has hampered the prospects of first-time buyers, Mr Boulger, who is senior technical manager at the mortgage firm, believes.

The lower limit for stamp duty of one per cent currently affects all houses worth over £125,000 – a "paltry" price to pay in today's housing market, Mr Boulger argues.

"With average house prices now around £200,000 the lower limit should be set at this level", he insists, as part of a "complete overhaul" of the housing tax system.

Stamp duty currently affects up to 60 per cent of all first-time buyers the Halifax found in a report last month, while one in five homes pays the higher rate of stamp duty, applied to all properties valued at more than £250,000.